Glossary

The maturity date is the date on which a financial instrument, such as a bond or loan, comes due and must be paid off or redeemed. 📆

At this point, the principal amount, along with any remaining interest, becomes payable to the bondholder or lender. This date is an essential aspect of debt instruments, as it specifies the time horizon for receiving the final payment.

For example, a 5-year bond issued on January 1, 2023, would have a maturity date of January 1, 2028. On that date, the bond issuer would be obligated to pay back the bond's face value to the bondholder.

Fun fact: US Treasury bonds, also known as "long bonds," have maturities ranging from 10 to 30 years, ⏳ while Treasury bills (T-bills) have much shorter maturities, ranging from a few days to 52 weeks. The various maturities cater to different investor preferences and time horizons.